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A Not for Profit research study into employee retention identifies a gap in the perceptions of HR managers and employees around the reasons employees leave. Understanding the five top reasons employees leave can help NFPs take action to improve retention.

A Not for Profit research study into employee retention identifies a gap in the perceptions of HR managers and employees around the reasons employees leave. Understanding the five top reasons employees leave can help NFPs take action to improve retention.

Maxxia Workplace Insights Not-for-Profit Sentiment Study highlights that nearly half (45 per cent) of NFP HR managers cited attracting and retaining staff as one of their most significant challenges. To improve retention rates it is important for NFP leaders to understand the factors most likely to contribute to an employee wanting to leave.

Maxxia’s study found five main reasons employees consider leaving the NFP sector:

1. Poor career progression

2. Low wages

3. Poor management

4. Poor morale

5. Too much stress

The research canvassed the perceptions of employees in the NFP sector, and HR managers. While both groups agreed career progression and wages were the primary reasons employees considered leaving the sector, there was a significant gap between the perceptions of HR leaders and employees on three other factors reflecting a disconnect between employee drivers to leave and the understanding of HR managers.

Career progression is the top reason employees consider leaving

Around one third of NFP employees (34 per cent) and HR managers (38 per cent) stated that poor career progression opportunity is the main reason employees look to move on.

This factor was also highlighted in the 2010 Productivity Commission’s report, which noted that the smaller size of many NFPs, together with funding constraints, results in fewer career path options, less investment in staff training and high turnover.

Improving the quality of management is a key opportunity for change

Maxxia’s study showed HR managers significantly underestimate the impact of poor-quality management, and to a lesser extent poor morale and stress in the workplace.

The quality of management was a key reason a third (30 per cent) of employees considered leaving, while only 4 per cent of HR managers saw this as a driver. With management quality playing such a significant role in impacting your employee retention, investing in the development of your management personnel is key.

Understanding the impact of quality management for NFPs presents an opportunity\for HR leaders to invest in leadership skills development. Leaders should spend timecommunicating and engaging with employees to understand where the improvements in management performance could be made.

Workforce stability can positively impact other factors influencing an employee’s desire to leave, such as morale and too much stress. Both generally suffer in times of high turnover due to the impact on remaining staff members who must ‘carry the load’ until a new employee is fully competent in their role.

Regular monitoring of human resources performance – including employee engagement, supervisor performance, morale and intentions to leave, together with exit-interview data – can help NFPs identify and take action on the issues of most concern to employees.

In a sector where turnover can be high, it is critical for NFPs to delve into the reasons whyemployees decide to move on, and understand what they can do to help them stay.